Jeep vs Bronco | Full Throttle | 4

0:08It's December 2008, Washington, D.C. A cold rain is falling on Capitol Hill. Bob Corker, a 56-year-old silver-haired freshman senator from Tennessee, stands in the front of his fourth-floor office window watching cars pass. The weather is as dreary as the nation's economy. Two months earlier, the financial industry nearly collapsed. Now General Motors and Chrysler are on the brink of bankruptcy, and it looks like Corker will be the deciding vote on whether Congress bails them out or lets automakers face the death sentence. At Corker's door is Ron Gettelfinger, the president of the United Auto Workers Union.

0:51Gettelfinger is a 64-year-old Midwesterner who sports a white brush mustache. He's known as a master negotiator. The two men shake hands and take seats directly across from each other. They get right to business. Senator, I hope we can count on your vote. Ron, I honestly don't think Congress should be giving Detroit and the autoworkers a blank check. Chrysler has to restructure. I know it owes billions to union workers, but everyone has to give. If you want me to support a bailout, the union's got to take pay cuts. Gettlefinger frowns. Senator, I've been working in the car business since I left the family farm when I was 20.

1:30Union membership peaked not long after that, and we've lost a lot of pay since then. And now, when the economy's tanking, you want me to agree to cut salaries and snatch nest eggs from 115 ,000 Chrysler retirees? I won't do it. The senator doesn't reply. The union chief reaches into his jacket pocket and pulls out a piece of paper. Senator, this is a column written by the head of the Steelworkers Union. It's titled Save the Jeep, Save the Nation. It says that back in 1941, a jeep was driven up the steps of the Capitol as a demonstration of American ingenuity and strength. Corker folds his arms over his chest and Gettlefinger presses on.

2:09Senator, if Congress doesn't vote to save Chrysler from bankruptcy, the steelworkers will ask Jeep owners to drive their roaring Jeeps up the Capitol steps again. Corker stands up and walks back to his office window, which frames this gray, dismal day. Ron, when I was a kid working in construction, way before I started my own real estate development company, I was a card-carrying union member. But I just can't vote to use tax dollars to prop up failed businesses like Chrysler, especially if the union won't do its part. Days later, the proposed auto bailout goes before Congress, where Corker proposes steep pay cuts for autoworkers by 2009.

2:51Democrats want the cuts to kick in much later. The bill is doomed when the two sides fail to compromise. But before a parade of Jeeps can storm the Capitol steps, President George W. Bush wades into the fray. In the midst of a financial crisis and a recession, allowing the U.S. auto industry to collapse is not a responsible course of action. The Bush administration offers the ailing giants a$17 billion infusion. But there's a catch. In exchange for the bailout, Chrysler has to restructure its operations to reduce costs. It's now up to Chrysler to either fix its problems or face the executioner.

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5:45From Wondery, I'm David Brown and this is Business Wars.

6:00The End

6:21hands of a private equity firm. And inside Ford, a subversive group of employees tried, and tried again, to find a way to resurrect the Ford Bronco. Now Ford and Chrysler must navigate the Great Recession while trying to run each other off the road. At Chrysler, a charismatic new leader will struggle to polish the long-neglected Jeep division, just as a new Bronco is about to buck loose. This is Episode 4, Full Throttle.

6:58It's January 2009, Dearborn, Michigan. A handful of Ford executives file into a conference room inside the company's headquarters to discuss the latest vehicles in Ford's pipeline. The top executive in the room leads things off. So where are we on the brand new Ford Focus? We're having the usual problems with launching a new vehicle. That could cause some delays. And we gotta accelerate. The budget-friendly Focus gets almost 32 miles to the gallon on the highway. And that could give the eco-friendly car a real sales boost in a tough economy. And Ford needs that bump. Badly. Sitting at the far end of a conference table, a 40-year-old product marketing manager named Mark Gruber nervously opens a file folder.

7:46Gruber clears his throat and runs one hand through his unkempt red hair. Could I make a suggestion? Sure, Mark. Gruber's been a leader in a movement inside Ford called the Bronco Underground. It's been working since 1999 to bring the Ford Bronco back into production. The movement operated in the shadows for years. Then in 2008, it came into the light with a proposal to build a Bronco targeting millennials. But the effort stalled. Well, it's about the Bronco. The executive team hasn't approved our plans for what we've been calling the millennial Bronco. Times are tough right now, but the economy will rebound.

8:25And when it does, buyers will want something sexier than the Fiesta. The top executive in the meeting gives Gruber an exasperated look. Mark, the country is in too deep of a recession to bank on a rebound, so stop talking about the goddamn Bronco. It's history. After a decade of trying to bring the Bronco back, the Bronco Underground's efforts have reached a dead end. Lucky for Ford, Chrysler is stuck in reverse. To survive, yet another foreign carmaker will need to come to its aid, whether Chrysler wants it to or not.

9:06It's March 2009 in Washington, D.C. Inside the office of Treasury Secretary Larry Summers, nine people wedged themselves around a small rectangular table. They're members of the presidential task force, whose mission is no less than to save the auto industry. They refer to themselves as Team Auto, and their lead member, the government's so-called car czar, is 57-year-old investment banker Stephen Ratner. Summers turns to the team. Okay, so we're here to vote on what to do about Chrysler. The Bush administration gave them a boatload of cash and they pretty much burned through it. So, do we give Chrysler more taxpayer dollars to keep it in business?

9:49Or liquidate it? I'm sure selling Jeep would fetch a little money for Chrysler's creditors. So, a show of hands from those in favor of liquidation. Four members of Team Auto raise their hands. And who wants to keep Chrysler in business? Four more hands go up, including Ratner's. The Treasury Secretary breaks the tie, voting to save Chrysler. But Ratner spells out a condition for his backing. We all know Chrysler can't survive on its own. We need to force a marriage, and there's only one suitor. Now, the matchmakers must try to arrange a shotgun marriage between Chrysler and the Italian automaker Fiat.

10:32But getting the two reluctant companies to the altar won't be easy.

10:43It's April 2009, inside the Treasury Department. The team auto members, including Ratner, gather around a large conference table. Outside, cheerful pink-hued cherry blossoms are in bloom. But inside, the mood is tense. Team Auto has spent weeks convincing Chrysler's top executives and United Auto Workers Chief Ron Gettelfinger that Fiat is the right fit for Chrysler. Now, Ratner is struggling to get Fiat to pay a fair price for the maker of Jeep. A deal with Fiat is the only way to save Chrysler. But to make that happen, we've all got to give a little. And that starts with Fiat itself. Ratner leans across the table toward Fiat's CEO.

11:27He's a 56-year-old Italian-born Canadian named Sergio Marchionne. In Italy, he was credited with turning around a once-ailing fiat. He believes he can do the same for Chrysler. Ratner yanks his tortoiseshell glasses off his face and tosses them on the table. Sergio, the government will extend$6 billion in loans to keep Chrysler afloat. But if you really want Chrysler, you have to put up some cash. How much will you pay? Steve, I've already told you, Fiat will not pay a dime for Chrysler. Come on! Do you know how bad it will look politically if the government lets a foreign company take Chrysler for free?

12:06Marchione pushes back a strand of his shoulder-length salt-and-pepper hair. He smirks at Ratner with the preening confidence of a race car driver. I'm not a politician, so I don't care how it will look to taxpayers. What I do care is about rebuilding Chrysler. And Fiat can do that. What we bring to the table is expertise in building fuel-efficient smaller cars, the kind that are in demand right now. Yeah, but Chrysler gives Fiat something it doesn't have. Jeep. An iconic brand with worldwide name recognition. Marchione pulls a hair from his trademark black sweater, then removes his round wire-rimmed glasses and neatly folds them before he continues.

12:48The room waits. Gentlemen, here's the bottom line. Fiat is the only company willing to take a gamble on running Chrysler, so you can either take our offer or leave it and let Chrysler die. Team Auto swallows bile but takes the deal, which gives Marchionne management control over Chrysler for no money down. It also gives Fiat 20 % of Chrysler's stock, with options to eventually buy all of Chrysler once the government's loans are paid. But as Marchione takes the keys to Chrysler, no one knows whether he'll crash the company or drive it to new heights.

13:34It's 2013, Dearborn, Michigan. Mark Gruber, the Bronco underground leader, is in a mundane meeting going over paperwork with a Ford corporate attorney. Suddenly, he reads something that snaps him out of a stupor. Whoa. Does this say the trademark to the Ford Bronco is going to expire this year? Uh, yep. Well, I'm not going to let that happen. What do I need to do to ensure Ford keeps the trademark? Well, you could build a new Bronco. Gruber rubs his temples in size. I can't do that. I'm not even supposed to say the word Bronco around Ford anymore. What else have you got? Um, you could display a new Bronco concept somewhere, like at a car show.

14:20Gruber rushes out of the meeting and calls the Bronco Underground into action. Six weeks later, they've come up with a seat-of-the-pants plan to preserve the Bronco trademark.

14:37A Ford employee is in the driver's seat of a beefed-up Ford Expedition, just outside of an auto show in Tampa, Florida. The SUV has oversized tires and a pair of massive tow hooks on its front end. The Expedition also sports three stainless steel logos on both sides and the rear that read Bronco. Let's go! The employee drives the expedition dressed up as a Bronco up a ramp and onto a loading dock. An auto show attendant waves him forward and the vehicle rolls slowly into the convention center and down a carpeted path. It stops at a spot that's surrounded by Ford logos and a banner that reads, The 2013 Ford Bronco.

15:24When the employee gets out of the expedition, a Ford executive approaches. Are we sure this is all we need to do to keep the Bronco trademarked? Totally. The lawyers say we just had to put a Bronco out in the world somewhere. And this is, well, somewhere. I know this isn't really a Bronco, but it's good enough to keep the trademarked. The Ford stunt barely keeps the Bronco alive. But Jeep doesn't see it as a threat because it's racking up record sales while the Bronco remains off the market. But as the economy begins to recover, the Bronco will get a new lease on life. And that means anything can happen.

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18:05It's March 2014 in Turin, Italy. At high noon, the CEO of Chrysler and Fiat, Sergio Marchionne, speeds around an oval track in a brand-new sports car, an Alfa Romeo 4C. A half-dozen other sports cars in a helicopter are parked just off the track built on the roof of an old Fiat factory. After a few laps, Marchionne guides the Alfa Romeo to a stop. He puts the manual transmission in park and hops out, addressing a nearby Fiat engineer. This thing drives as smooth as silk. We ought to sell a lot of them at our$55 ,000 price point. Marchione tosses the keys to the engineer and walks towards the chopper.

18:49Next stop is the Turin Airport and a private jet ride to Detroit.

18:59Nine hours later, Marchione arrives at his office inside Chrysler's Auburn Hills headquarters. It's the early afternoon, and a reporter is waiting for it. Marchionne and the reporter walk into his office and sink into Italian-made leather chairs. He points out the window to a 15-story tower that's topped with the Chrysler logo. See that building? Chrysler CEOs used to have their offices on the top floor. No, not me. I left that office empty and moved down here where the engineers were. Wow, that's quite a change. Yes, we've made lots of changes. This was an incredibly hierarchical organization, but it's not anymore.

19:40Marchionni scratches at his stubbly beard. In his casual black sweater, he looks less like a buttoned-up car executive and more like a tech boss. His image and race car driver's swagger partly explain why the gregarious CEO is catnip to the media. Today's visiting reporter flips a page in his notebook to find his next question. Mr. Marchionne, a lot of people call you Chrysler's savior. What's been your biggest single success since coming here? Well, last year, Chrysler made a$2.8 billion profit. And in 2011, we repaid all$6 billion loaned to us by the U.S. government. That was six years ahead of schedule.

20:20That was good. But for me, it's all about Jeep. You know, during the Daimler-Chrysler years, Jeep sales declined by 12%. But in 2012, we sold 700 ,000 Jeeps. That's a record. In 2013, we plan to beat that record. We may get to a million a year soon, and we want Jeep to be the largest brand inside of Fiat Chrysler automobiles. So what's driving those sales? We invested in the brand. We improved quality, and we have made sure that every Jeep we make has a rugged backbone. Even the Jeep SUVs can go places that most SUVs made for soccer moms wouldn't dare. With a Jeep, we've given Americans the thing that they want.

21:03A powerful car that can go anywhere. Marchionne takes a victory lap during his interview. But the recovering economy is a big factor in Jeep's rebound. And that same law of economic physics is also boosting the Ford Bronco.

21:25It's March 2015, Dearborn, Michigan. Inside Ford's modernist rectangular headquarters known as the Glass House, Bronco Underground leader Mark Gruber takes a phone call from Ed Ostrowski, known inside Ford as Eddie O. He's in charge of keeping track of every vehicle Ford makes, or is planning to make. And there's one big change that he knows Mark is going to want to hear about. Hey Eddie, what's up? We've decided to move production of the Ford Focus from Michigan to Mexico. Now that gas is cheaper, people want SUVs again. Heck, SUVs are now outselling sedans for the first time ever. So, uh, what are you saying, that there's room to make SUVs in Michigan now?

22:05It means we'll have room to make one other vehicle there if it can be assembled on top of the Ranger's T6 chassis. So, uh, tell me, what should that new vehicle be? Gruber's hands start sweating. He already knows a new Ford Bronco could be made using the T6 platform. But he's also been ordered to stop even saying the word Bronco around Ford. He takes the gamble, but tries to sound casual. How about we build a Bronco? Sure, Mark, if you can prove there will be demand for it. Gruber hangs up and grins as he prepares to share the news with other members of the Bronco underground. The group still meets, although it does so out of the view of Ford's top executives.

22:50The Underground has already determined that Ford's T6 platform would fit their informal plans for a new Bronco. Gruber calls Bronco Underground member Tom Patterson, a Ford product strategist. Hey Tom, it's Mark. I just got approval to bring the Bronco back, if we can make a business case for it. That's great. But we've been proving the business case since 1999 and the brass keeps shooting us down. How are we supposed to convince them this time? Gruber glances over to the binder on his desk labeled Millennial Bronco. It's one of the many Bronco variations that Ford has squashed over the years.

23:27But it gives him an idea. Look, we found plenty of vintage Bronco owners online who say they want a new Bronco. What we need to do is prove that there's another market to be tapped. What market would that be? The Jeep market. The Bronco Underground soon embarks on a new undercover mission. They'll meet Jeep owners out in the wild, on off-road trails around the country, to uncover everything that a Bronco could do better than a Jeep.

24:04It's September 2015 in Columbiana, Ohio. On a chilly overcast day, four Jeep Wranglers carrying members of the Bronco Underground approach the site of an annual Jeep event called the Four-Wheel Drive Hardware Jamboree. Gruber steers his Wrangler through a dirt field that's serving as a makeshift parking lot for hundreds of Jeeps. They're painted in an array of colors. Cosmos Blue, Flame Red, Sahara Tan, and Orange Crush. And then Gruber hits a muddy patch. Gruber pulls to the side and watches as jeep after jeep splashes through the mud. Gruber approaches a jeep driver who's securing doors that he's removed from his Wrangler.

24:49Hey man, need some help? Nah, I'm good. But it's such a pain figuring out what to do with these doors every time I take them off. They're too big to fit in the back of the jeep, and once they're off I lose my side mirrors. Eh, not the best design, is it? Not at all. Gruber picks that moment to awkwardly bring up the Bronco. Hey, I think the old Ford Bronco had doors you could take off and fit in the back. Oh, I know. My uncle had a Bronco. We used to take it out hunting. You could beat the hell out of it and it'd keep on going. You know, Ford should bring it back. It might give the Wrangler a run for its money.